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News item: The tobacco industry is pouring money into defeating Prop 29, a June statewide ballot initiative to raise taxes on cigarettes to fund cancer research.

Reaction: I wish I didn't have to say it, but tobacco may be on the right side of this fight.

A couple huge caveats. Tobacco companies have a well-earned reputation for evil. Cigarette taxes make all the sense in the world for the state, since California needs the money and raising sin taxes can discourage unhealthy behavior.

I don't smoke and don't like being around people who do. I've lost loved ones to smoking-related cancers. And if I were king, I'd tax these companies into bankruptcy.

So what's the problem?

Let me try to say this while holding my nose: This initiative is an example of how California gets budget and tax policy wrong.

It's a classic case of ballot box budgeting. The tax dollars don't go to the general fund. They don't even go to major health programs--which are starving for money. The taxes are put in a special trust funds that can't be touched by the legislature. The only way to change this is by another vote of the people -- which means only a person or interest with millions of dollars could make the change.

Our elected officials don't have a role in managing this money, so they can't use it for other purposes even if there's a more pressing need. Indeed the allocation of funds is specified by the initiative -- 60 percent to cancer research, 15 percent for research facilities, 20 percent to tobacco prevention and control, 3 percent for law enforcement.

This is good politics, but bad policy. These kinds of funding silos are a way of siphoning off state funds for causes that have famous or rich backers (Lance Armstrong has been a prominent supporter of this measure) while letting other broader program starves. Voters have decided to fund early childhood programs, mental health, and stem cell research in this way. Those programs remain robust -- while broad health programs for children and the elderly are gutted.

That's because they have initiative protection; programs approved by voters can't be changed except by another vote of the people. This initiative is actually better than most -- in that it does permit legislative amendments eventually, but only after 15 years. And only then if the committee overseeing the funds agrees. And only then if the legislature approves amendments by a 2/3 vote (adding yet another supermajority into a California governing system that is choked with supermajorities).

Indeed, this measure is a good example of why we need an initiative reform that requires any initiative that establishes a supermajority to pass by that supermajority.

A political prediction: Californians may not give this 2/3, but it's a fairly good bet to pass. it would be a tougher fight if voters realized the nasty choice they were being given: Vote yes and adopt a terrible policy that makes budgeting even worse, or vote no and side with evil companies.

Developed for the California Alliance for Jobs, the three-and-a-half minute video was released on the same day that the High Speed Rail Commission approved a new business plan for the project.

That vote sends the plan to the legislature, where the project---which has drawn fire due to cost and ridership projections--faces a crucial vote this summer.

The theme seems appealing to the governor, who--Schwarzenegger-like--told KGO Radio on Friday that lawmakers should "man up" and make necessary budget cuts.

On the broadcast, he defended the high speed rail project.

The timing of the video in coordination with the commission vote marks an escalation of a campaign by the governor's supporters to counter negative publicity from legislative critics, as well as questions raised by the state auditor. Brown has been an outspoken supporter of the project.

The video uses a clip from his most recent State of the State address, in which he asserts that California citizens don't want to back away from the project.

"I know this state and the spirit of the peoplewho chose to live here," Brown said in the speech excerpt. The YouTube video compares the conflict to previous disputes over building the Golden Gate Bridge, the Central Valley Project, BART, and the Los Angeles Metro transit system.

The video says that the High Speed Rail project would provide "tens of thousands" of construction jobs, reduce dependence on fossil fuels, and cut greenhouse gas emission "by 3 and a half million tons annually."

Critics in the legislature are vowing to seek another statewide vote to see if the public has had a change of heart. California voters approved $9 billion in bonds as seed money in 2008.